Gordon Gekko
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What’s the tax treatment of those transactions you’re suggesting?
What’s the tax treatment of those transactions you’re suggesting?It’s sounds completely weird and if I was a tenant with zero knowledge of tax tenancy law I’d reckon I was being set up for something.
A landlord who increased my rent by the legal maximum and then reimbursed me by as much every Christmas wouldn’t make me think twice.
I'm not familiar with the HAP scheme; however, the rent holiday would be the tenants contribution.And what does HAP pay, the fake rent or the real rent?
If it's the fake rent and the tenant gets a refund or a 'rent holiday' then it's presumably fraud.
The landlord’s rental liability is on the rent paid less the discount. I’ve given tenants occasional discounts for various reasons over the years and have paid tax on the net rent, not the gross.What’s the tax treatment of those transactions you’re suggesting?
That reads a lot like the rent then being the lower amount for RTB purposes, and potentially being the higher amount for income tax purposes and some form of gift to the tenant.The landlord’s rental liability is on the rent paid less the discount. I’ve given tenants occasional discounts for various reasons over the years and have paid tax on the net rent, not the gross.
Why would anyone declare income they didn’t have?
Disclaimer: I have no idea how HAP works and there may be other landlord obligations at play.
Agreed.be very wary of gifting HAP money back to the tenant
That reads a lot like the rent then being the lower amount for RTB purposes,
The tenant’s tax affairs are their own business. If the tenant feels that they have been given a gift than it would be covered by the €3,000 small gift exemption.and potentially being the higher amount for income tax purposes and some form of gift to the tenant.
Whilst this is true - I think the comments in regards to HAP are valid.Taxi fares are regulated and a taxi driver is perfectly entitled to give a discount to the legal maximum fare.
The whole point is to get the rent to the higher level. Your plan reduces it again in my view.It’s perfectly possible to give a discount to a regulated price. Taxi fares are regulated and a taxi driver is perfectly entitled to give a discount to the legal maximum fare. Taxi drivers, like any of us, are obliged to pay tax on income actually received and not on a theoretical income based on a regulated price.
The tenant’s tax affairs are their own business. If the tenant feels that they have been given a gift than it would be covered by the €3,000 small gift exemption.
So whilst a rent holiday is perfectly legitimate in general; I too would be wary where state funded rental is involved.
I think you misunderstand the meaning of a gift. A discount or accumulation of discounted granted in the course of business for example is not a gift.True, but there's nothing to stop a landlord of a hap property giving the tenant a gift. Small gifts can be to anyone. No reason for the council to be involved.
I think you misunderstand the meaning of a gift. A discount or accumulation of discounted granted in the course of business for example is not a gift.
My point stands.If I had a tenant and gave them a voucher or cash of €x at say Christmas and Easter, that's not a gift, but what if I gave wine or chocolates, are they gifts ?
Where?I constantly read....
Is it not? Do people do it for fun, or in the hope of making money? If the latter, of course it's a business....that renting of residential property by individuals is not a business.
Nobody mentioned companies.I don't believe this thread is about companies whose commercial business is residential lettings.
My point stands.
Where?
Is it not? Do people do it for fun, or in the hope of making money? If the latter, of course it's a business.
Nobody mentioned companies.
You don't have to have a company to be in business.
Anyone who uses a limited company as a vehicle for residential lettings is either a tycoon or a moron.
I don't see your point here. If you're giving money to someone with whom you've a business relationship, of course it's a transaction in the course of business. Try giving some money or a voucher to a public official for Christmas, and they'll soon tell you they can't accept it.However, if I as a private individual (not a trading entity), choose to give a gift to another private individual, how would anyone conclude that it was accumulated business discounts?
For a person on a low income the cashflow here is likely to be a problem.Simpler solution is to increase the rent, have it paid in the usual way & offer a rent holiday once or twice a year. Say December / June
I have done this in the past, and I had no issues.I don’t see anything wrong with it. Tell her in writing that the higher amount is due and send her the odd chaser by email. But reassure her verbally it’s just a ruse.
One of my tenants deliberately did not tell HAP when he moved out, so they paid me a half month extra. Tenant wanted me to pay him that. He's the only tenant I've never paid a deposit back to as he's an utter crook. And if I paid him it I'd be over a barrel if HAP came looking for it. He only apologised to me when we sent a solicitors letter to him. More lies from him of course.I'd be very wary of gifting HAP money back to the tenant, it would leave you open to claims of colluding with the tenant on benefit fraud.
How does that work if there is no written lease?Not sure if this document is up to date, but it states that tax must be paid on rent receivable as per the lease, not the actual rent paid. So if you receive less than stated on the lease, you write it off each year as a bad debt. Would you need to prove it's not recoverable? As Gordan said, an odd email about the unpaid rent would show you tried to recover it.
"Members should be aware rental income is taxable on a receivable basis i.e what
you are entitled to receive as per the lease rather than what was actually received.
Any unpaid rent, if not recoverable, can subsequently be written off as bad debt and
a refund can be claimed for any tax paid on it."
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